TOKIO MARINE FUNDS PLC

Transcription

1 TOKIO MARINE FUNDS PLC Tokio Marine Asia Pacific Equity Fund SIMPLIFIED PROSPECTUS 25 March, 2011 This Simplified Prospectus contains key information in relation to Tokio Marine Asia PacificEquity Fund (the "Fund"), a sub-fund of Tokio Marine Funds Plc (the "Company"). The Company is an open-ended umbrella investment company with variable capital, incorporated with limited liability in Ireland under the Companies Acts 1963 to 2009 on 8 March, 2010 with registration number The Company was authorised by the Central Bank of Ireland (the Central Bank ) on 19 March, 2010 as an undertaking for collective investment in transferable securities pursuant to the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations, 2003 (S.I. No. 211 of 2003), as amended. The Fund was approved by the Central Bank on 25 March, The Company has segregated liability between each sub-fund. As at the date of this Simplified Prospectus, the Company has two other sub-funds; the Tokio Marine Japanese Equity Focus Fund and the Tokio Marine Japanese Equity Leaders Fund. Potential investors are advised to read the Prospectus, dated 26 August, 2010, and the relevant Supplement for the Fund, dated 25 March, 2011 (the "Prospectus"), before making an investment decision. The rights and duties of the investor are outlined in the Prospectus. Defined terms used herein have the same meaning as set out in the Prospectus. The Base Currency of the Sub-Fund is US Dollars. Investment Objective The investment objective of the Fund is to achieve a return in excess of the Index and to maximise medium to long term growth through investment in Asia Pacific (ex Japan) equities. Investment Policy / Efficient Portfolio Management Investment Policy The Fund will seek to achieve its investment objective through investment mainly in securities such as equities listed in or to be listed in Asia Pacific countries and regions or securities of companies that exercise the predominant part of their commercial activities in Asia Pacific countries and regions, including but not limited to China, Hong Kong, South Korea, Taiwan, Singapore, Malaysia, Thailand, Indonesia, Philippines, India, Pakistan, Vietnam, Sri Lanka, Australia and New Zealand. There shall be no restrictions (such as market capitalisation or sector specific restrictions etc) on the types of companies in which the Fund invests. The Fund may also invest in depository receipts and equity index futures. The Fund will select investments mainly through using a bottom-up approach that focuses on research and analysis of individual companies. This research is conducted by the Sub- Investment Manager s team of fund managers and analysts supplemented by country selection based on qualitative scoring to measure the relative attractiveness of each country. The relative attractiveness of each country is determined by conducting top-down analysis on macro economics and equity market outlook of each country. The analysis focuses on GDP growth momentum, interest rates, earnings revision, liquidity, valuation of equity markets and other significant factors which may affect the equity markets, for instance, strong GDP growth momentum, accommodative interest rate, upward earnings revision and low valuation of equity markets shall be deemed as attractive and the Fund will put a higher qualitative score on such situations. The performance of the Fund's portfolio of investments will be measured against the Index. The Investment Manager may at any time change the Index where, for reasons outside of its control, the Index has been replaced, or another index or benchmark may reasonably be considered by the Investment Manager to be the appropriate standard for the relevant exposure. Such a change would represent a change in the investment objective of the Fund. The Fund may invest in equity linked notes/rights and depository receipts, specifically ADR (American depository receipt) and GDR (Global depository receipt), of issuers registered in Asia Pacific countries and regions, such as China, Hong Kong, South Korea, Taiwan, Singapore, Malaysia, Thailand, Indonesia, Philippines, India, Pakistan, Vietnam Sri Lanka, Australia and New Zealand. The Fund may engage in forward foreign exchange contracts for hedging purposes, to alter

2 the currency exposure of the underlying assets, in accordance with the limits set out by the Central Bank. The Fund may hedge currency exchange risk by entering into forward, futures and currency swap contracts and purchasing and selling put or call options on foreign currency and on foreign currency futures contracts within the limits set out by the Central Bank. Because currency positions held by the Fund may not correspond with the asset/securities position held, the performance may be strongly influenced by movements in the foreign exchange rates. The Fund will not be leveraged as a result of engaging in forward foreign exchange contracts, forward, futures and swap currency contracts, call options on foreign currency or foreign currency futures contracts. Additional information is included under the heading Efficient Portfolio Management. The Fund may invest up to a maximum of 20% of the Net Asset Value of the Fund in other collective investment schemes in accordance with the requirements of the Central Bank and the investment restrictions set out in Appendix I to the Prospectus, where the investment policies of such collective investment schemes are consistent with those of the Fund. Where circumstances so warrant, for example for temporary defensive purposes or when markets are subject to economic or political instability, the Fund may hold ancillary liquid assets in currency or time deposit accounts, or in regularly traded short-term Money Market Instruments, issued or guaranteed by institutions rated at least A / A2 (long term) or A1 / P1 (short term) by Standard & Poor's / Moody's, and having a remaining maturity of less than twelve (12) months. Liquid assets and investments of the Fund may be held in US Dollars and in the currencies of the Security Investment Countries. The investment objective of the Fund may not be altered and material changes in the investment policy of the Fund may not be made without the prior written approval of all Shareholders or without prior written approval on the basis of a majority of votes cast at a meeting of the Shareholders of the Fund duly convened and held. In the event of a change of the investment objective and / or a material change to the investment policy of the Fund, on the basis of a majority of votes cast at a general meeting, Shareholders in the Fund will be given reasonable notice of such change to enable them redeem their Shares prior to implementation of such a change. The Fund's investments are subject to the investment restrictions as set out in Appendix I of the Prospectus. No assurance can be given that the Fund's investment objective will be achieved. A list of the stock exchanges and markets in which the Fund is permitted to invest, in accordance with the requirements of the Central Bank, is contained in Appendix II of the Prospectus and should be read in conjunction with, and subject to, the Fund's investment objective and investment policy, as detailed above. The Central Bank does not issue a list of approved markets. With the exception of permitted investments in unlisted securities, investment will be restricted to those stock exchanges and markets listed in Appendix II of the Prospectus. The Company will employ a risk management process which will enable it to accurately measure, monitor and manage the risks attached to financial derivative positions and details of this process have been provided to the Central Bank. The Company will not utilise financial derivative instruments which have not been included in the risk management process that has been filed with and cleared by the Central Bank until such time as a revised risk management process has been submitted to and cleared by the Central Bank. The Company will provide on request to Shareholders supplementary information relating to the risk management methods employed by the Company including the quantitative limits that are applied and any recent developments in the risk and yield characteristics of the main categories of investments. Efficient Portfolio Management The Fund may engage in transactions in financial derivative instruments for the purposes of efficient portfolio management and / or to protect against exchange risks within the conditions and limits laid down by the Central Bank from time to time. Efficient portfolio management transactions relating to the assets of the Fund may be entered into by the Investment Manager with one or more of the following aims: (i) the reduction or stabilisation of risk; (ii) the reduction of cost with no increase or a minimal increase in risk; and / or (iii) the generation of additional capital or income for the Fund with a level of risk consistent with the risk profile of the Fund and the diversification requirements in accordance with the Central Bank s UCITS Notice 9 "Eligible Assets and Investment Restrictions" and as disclosed in

3 Appendix I to the Prospectus. In relation to efficient portfolio management operations the Investment Manager will look to ensure that the techniques and instruments used are economically appropriate in that they will be realised in a cost-effective way. Such transactions may include foreign exchange transactions which alter the currency characteristics of transferable securities held by the Fund. Such techniques and instruments are set out in Appendix III of the Prospectus and include, but are not limited to, futures, options (writing and purchasing), forward foreign exchange contracts, swaps (including interest and, exchange rate swaps), contracts for differences, stocklending and repurchase and reverse repurchase agreements and when issued and / or delayed delivery securities. Any techniques or instruments which are used by the Investment Manager will only be used to gain exposure to underlying assets which could be invested in by the Investment Manager in accordance with the Fund's investment objective and investment policies. It is not the current intention of the Fund to use financial derivative instruments for investment purposes. Should this intention change the Prospectus and this Supplement shall be amended in accordance with the requirements of the Central Bank. Leverage arising as a result of the use of financial derivative instruments will be limited to 100% of the Net Asset Value of the Fund. For more information on the Investment Policy of the Fund, please see the Prospectus. Risk Profile General Please consult section of the Prospectus headed Risk Factors together with the relevant Supplement for the Fund for a more detailed analysis of the risk profile of the Fund. Principal risk factors outlined in the Prospectus include; market capitalisation risk, market risk, exchange control and repatriation risk, political, regulatory settlement and sub-custodial risk, liquidity risk, redemption risk, credit risk, currency risk, investing in fixed income securities, changes in interest rates, amortised cost method, valuation risk, accounting, auditing and financial reporting standards, derivatives and techniques and instruments risk, securities lending risk, investment manager valuation risk, liquidity, share currency designation risk, cross liability for other sub-funds, concentration of investments, Japanese permanent establishment risk, geographic focus, exchange rate fluctuation, PRC Governmental, Economic and Related Considerations, Corporate Disclosure, Accounting and Regulatory Standards, Securities Markets, Custody Risk and Trading Volumes and Volatility risk. The value of investments may fall as well as rise, and investors may not receive back the amount invested. Profile of the Typical Investor The Fund is suitable for investors seeking to achieve long-term out-performance of the Index. Distribution Policy Dividends will not be declared in relation to the Class A, Class B, Class C or Class D Shares (the "Accumulating Shares"). The income, earnings and gains of the Fund attributable to the Accumulating Shares will be accumulated and reinvested on behalf of the holders of the Accumulating Shares. The Directors intend to operate the Fund so that certain Classes of Share of the Fund will be Classes of Shares in a 'reporting fund', as set out by HM Revenue and Customs in the UK, during each Accounting Period. The Directors intend to take all practicable steps, consistent with applicable laws, regulatory requirements and the investment objectives and investment policies of the Fund, to facilitate certification as a 'reporting fund' for such Classes of Shares. The exact conditions that must be fulfilled to obtain certification may be affected by changes in HM Revenue and Customs practice or by changes to the provisions of the relevant legislation. The attention of Shareholders and potential investors is drawn to the section of the Prospectus headed "Taxation" and in particular the tax treatment of investors in reporting funds.

4 The Directors may at any time determine to change the policy of the Fund with respect to distribution. If the Directors so determine full details of any such change will be disclosed in an updated prospectus or supplement and all Shareholders will be notified in advance of such change becoming effective. Fees and Expenses Shareholder Transactions Expenses Conversion Fee Redemption Fee it is not the current intention of the Directors to charge a conversion fee it is not the current intention of the Directors to charge a redemption fee. Fees Payable out of the Assets of Fund Full details of all fees are set out in the Prospectus. Investment Manager The Fund shall pay the Investment Manager an annual fee, accrued on each Valuation Day and payable monthly in arrears as a percentage of the Net Asset Value of the Fund or attributable to a Class at the following rates: Class A 0.10% Class B 0.10% Class C 0.10% Class D 0.10% The fees of the Investment Manager shall be paid at these rates until 31 December, With effect from 1 January, 2013, the fees of the Investment Manager shall be paid at the following rates: Class A 0.16% Class B 0.16% Class C 0.16% Class D 0.16% The Investment Manager shall be entitled to be reimbursed by the Fund for reasonable out of pocket expenses incurred by it and any VAT on fees and expenses payable to or by it. Sub-Investment Manager The Fund shall pay the Sub-Investment Manager an annual fee, out of the assets of the Fund, accrued on each Valuation Day and payable monthly in arrears as a percentage of the Net Asset Value of the Fund or attributable to a Class at the following rates: Class A 0.25% Class B 0.25% Class C 0.25% Class D 0.25% The fees of the Sub-Investment Manager shall be paid at these rates until 31 December, With effect from 1 January, 2013, the fees of the Sub-Investment Manager shall be paid at the following rates:

5 Class A 0.40% Class B 0.40% Class C 0.40% Class D 0.40% The Sub-Investment Manager shall be entitled to be reimbursed by the Fund for reasonable out of pocket expenses incurred by it and any VAT on fees and expenses payable to or by it. Distributor The Fund shall pay the Distributors an annual fee, accrued on each Valuation Day and payable monthly in arrears as a percentage of the Net Asset Value of the Fund or attributable to a Class at the following rates: Class A 0.15% Class B 0.15% Class C 0.15% Class D 0.15% The fees of the Distributor shall be paid at these rates until 31 December, With effect from 1 January, 2013, the fees of the Distributor shall be paid at the following rates: Class A 0.24% Class B 0.24% Class C 0.24% Class D 0.24% The Distributor shall be entitled to be reimbursed by the Fund for reasonable out of pocket expenses incurred by it and any VAT on fees and expenses payable to or by it.

6 Administrator and Custodian Administrator's Fees The Company shall pay to the Administrator, out of the assets of the Fund, an annual fee, accrued on each Valuation Day and payable monthly in arrears at a rate of 0.12% per annum of the Net Asset Value of the Fund, subject to a minimum annual fee of USD 60,000 (plus VAT, if any thereon). The Administrator shall also be entitled to receive, out of the assets of the Fund, an annual fee of USD 3,500 (plus VAT, if any thereon) for performing fund accounting services. The Administrator shall also be entitled to be repaid, out of the assets of the Fund, all of its reasonable out of pocket expenses incurred on behalf of the Fund, which shall include legal fees, courier fees and telecommunication costs and expenses together with VAT, if any, thereon. Custodian s Fees The Custodian shall be entitled to receive, out of the assets of the Fund, an annual trustee fee, accrued on each Valuation Day and payable monthly in arrears, at a rate of 0.025% per annum of the Net Asset Value of the Fund, subject to a minimum annual fee of USD 15,000 (plus VAT, if any thereon). The Custodian shall also be entitled to be repaid, out of the assets of the Fund, all reasonable out of pocket expenses, including, but not limited to, banking maintenance fees, interbank transfer fees, charges and telephone, letter, courier, facsimile and printing costs and expenses, and the fees, transaction charges and expenses of any sub-custodian appointed by it, which shall be at normal commercial rates. Each of the Administrator and Custodian shall be entitled to additional fees, up to a maximum of USD 10,000 per annum, to be agreed between the parties and the Company in circumstances including, but not limited to, the following: amendments to the Prospectus, this Supplement or the Articles of Association, additional services agreed, changes of other service providers to the Company, changes to the infrastructure of other service providers to the Company which necessitate changes to the infrastructure of the Administrator and / or the Custodian, or the liquidation of the Company or termination of the Fund. Governance Services Provider The Company shall pay an annual fee to the Governance Services Provider for the provision of services to the Company and Fund. Such fee will be subject to annual review and shall accrue and be payable quarterly in arrears. Paying Agent Fees and expenses of any Paying Agents appointed will be at normal commercial rates and will be borne by the Fund. Expenses The Investment Manager, Sub-Investment Manager, Administrator, Custodian, Distributor, Governance Services Provider and Paying Agent (if any) shall be entitled to be repaid expenses incurred on behalf of the Fund. VAT If the fees provided for above are subject to VAT, that VAT will also be payable out of the assets of the Fund.

7 Taxation The Company qualifies as an investment undertaking as defined in section 739B(1) of the Taxes Consolidation Act, 1997, as amended, and is not subject to Irish tax on its relevant income or relevant gains. No stamp duty is payable in Ireland on the issue, transfer, repurchase or redemption of Shares. Shareholders and potential investors should consult with their professional advisers in relation to the tax treatment of their holdings in the Fund. Publication of Unit Price The most up-to-date Net Asset Value per Share of the Fund is published, following calculation, on the following website: and will be notified to the Irish Stock Exchange immediately following calculation. In addition, the Net Asset Value per Share of each Fund may also be published on industry standard financial reporting websites, such as Bloomberg and Reuters. The most up-to-date Net Asset Value per Share of each Fund may also be obtained from the Administrator during normal business hours and may also be published in such newspaper or journal as the Directors in their sole discretion may determine and notify to Shareholders. How to Buy / Sell Units Applications for Shares may be made to the Administrator. Applications received by the Administrator prior to the Subscription Deadline for any Dealing Day will be processed on that Dealing Day. Any applications received after the Subscription Deadline for a particular Dealing Day will be processed on the following Dealing Day unless the Directors in their absolute discretion, and in exceptional circumstances, otherwise determine to accept one or more applications received after the Subscription Deadline for processing on that Dealing Day, provided that such application(s) have been received prior to the Valuation Point for the particular Dealing Day. Initial applications should be made using an Application Form obtained from the Distributors or the Administrator but may, if the Company so determines, be made by facsimile subject to prompt transmission to the Administrator of the original signed application form and such other papers (such as documentation relating to money laundering prevention checks) as may be required by the Directors or their delegate. Requests for the redemption of Shares should be made to the Administrator by written communication, facsimile, by electronic mail or by such other means as may be permitted by the Directors, in accordance with the requirements of the Central Bank (providing that, in the case of requests received by electronic mail, a scanned copy of the signed request is sent to the Administrator), and should include such information as may be specified from time to time by the Directors or their delegate. The original signed request for redemption and such other papers as may be required by the Directors or their delegate must be submitted to the Administrator promptly. Requests for redemption received prior to the Redemption Deadline for any Dealing Day will be processed on that Dealing Day. Any requests for redemption received after the Redemption Deadline for a Dealing Day will be processed on the next Dealing Day unless the Directors in their absolute discretion, in exceptional circumstances, determine otherwise. No redemption payment will be made from an investor holding until the original subscription application form and all documentation required by or on behalf of the Company (including any documents in connection with anti-money laundering procedures) has been received from the investor and the anti-money laundering procedures have been completed. The following Classes of Share are available for subscription: Class A USD 100 Class B GBP 100 Class C Euro 100 Class D USD 100 The Minimum Initial Subscription for each Class of Share in the Fund is as follows: Class A USD 1,000,000 Class B GBP 1,000,000

8 Class C Euro 1,000,000 Class D USD 1,000,000 The Minimum Holding for each Class of Share in the Fund is as follows: Class A USD 500,000 Class B GBP 500,000 Class C Euro 500,000 Class D USD 500,000 A Shareholder may make subsequent subscriptions, each subject to a Minimum Transaction Size as follows: Class A USD 500,000 Class B GBP 500,000 Class C Euro 500,000 Class D USD 500,000 The Directors reserve the right to differentiate between Shareholders as to and waive or reduce the Minimum Initial Subscription, Minimum Holding and Minimum Transaction Size for certain investors. Any change to the Minimum Holding will be disclosed to Shareholders. Additional Important Information Directors Ms. Denise Kinsella Mr. Karl McEneff Mr. Tetsuya Nakamura Mr. Yuichi Takayama Additional Important Information Investment Manager Sub-Investment Manager Custodian Administrator Company Secretary Governance Service Provider Distributors Promoter Auditor Legal Adviser, Tax Adviser and Listing Sponsor Tokio Marine Asset Management Co., Ltd. Tokio Marine Asset Management International Pte. Ltd Daiwa Europe Trustees Ireland Limited Daiwa Europe Fund Managers Ireland Limited Daiwa Europe Fund Managers Ireland Limited Bridge Consulting Limited Tokio Marine Asset Management (London) Limited and Tokio Marine Asset Management International Pte. Ltd Tokio Marine Asset Management Co., Ltd. PricewaterhouseCoopers, Ireland Dillon Eustace Copies of the Memorandum and Articles of Association, the latest annual and semi-annual reports and the Prospectus may be obtained (free of charge) from the offices of the Administrator during normal business hours: Administrator Daiwa Europe Fund Managers Ireland Limited Block 5, Harcourt Centre Harcourt Street Dublin 2 Ireland Q:\Commer\Simplified Prospectus\Tokio Marine Asia Pacific Equity Fund SP.df.doc